Silicon battery firm 1414 Degrees shuns patents to keep trade secrets

KFC's original recipe of "11 herbs and spices" was never patented, but the recipe from the 1940s remained secret until a handwritten note was found in 2016.

Taking a cue from the fast-food giant, some local inventors are shunning patents – preferring to keep at least some aspects of their inventions secret fearing disclosing the full details on the patent system will expose them to IP theft.

For Matthew Johnson, executive director and chief technical officer of 1414 Degrees, the high degree of disclosure in the patent process means he is reluctant to put everything on the public record. The Adelaide-based company is planning a $10 million public float on the back of a silicon "battery" that it claims can store as much electricity as a lithium ion battery at a tenth of the cost.

Secret recipe: 1414 Degrees chairman Kevin Moriarty and executive director and chief technical officer Matthew Johnson use a mix of patent protection, trade secrets and speed to market to give the company a competitive edge. David Mariuz

"Anyone can look at a patent and learn how something is done," said Mr Johnson. "Sure, it is theoretically protected, but the reality is your competitors are learning how we do things."

Mr Johnson said that while the patent process is important because it does offer some enforceable protection, actually doing that enforcing is difficult, costly and time-consuming.

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1414 Degrees, which built the technology on the back of patented research it acquired from the CSIRO, is now pursuing a strategy that involves speed to the market, filing patents and keeping trade secrets and "know-hows".

He said there were components of the silicon storage device that had not been registered for patent protection.

"There are some things we would rather not patent because it would be difficult to enforce and we don't want other people to know too much about the technology," he said.

1414 Degrees is not alone. Late last year Toowoomba's Wagner family revealed they had invented a new "earth friendly" concrete that contained no Portland cement. But having spent eight years perfecting the product, they chose not to patent the full recipe.

One of four brothers who runs Wagners, Joe Wagner, said registering for patent would expose the company to IP theft when most people would "struggle to break the chemistry around it anyway".

Patent lawyer Mark Summerfield said it was common for IP lawyers to advise clients against registering a patent because the system requires a person to provide a full disclosure of the technology, which then gets published after 18 months.

"The basic bargain of the patent system is the government grants you up to a 20-year monopoly on the invention in exchange for providing that full disclosure," Mr Summerfield said.

"You don't get 20 years of exclusive use for nothing."

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He said not registering for patent was a valid option where it is difficult to reverse engineer the technology. But there are risks.

"Just because you don't think you can reverse engineer – that might not be true in 10 years' time. Somebody else will do their own research and development," he said.

Mr Summerfield said keeping a trade secret could be as time-consuming and expensive as registering and enforcing patent.

"With trade secrets you have to make sure you limit access to the information. It is hard when you've got hundreds of employees and dozens of them need to know the secrets in order to manufacture the product. Some of them are ultimately going to work for a competitor and they're going to know your trade secrets," he said.

"The downside of that is once the secret's out, it's out," he said.

KFC chose to guard its 11 secret herbs and spices by having the seasoning made in two separate plants, with each half then combined so no one knew the whole recipe. That worked for more than 70 years. 1414 Degrees and Wagners will be hoping their secret recipes will be just as hard to crack.

The development of alternative supplies of critical minerals, as well as other joint efforts by Australia and the United States to address Chinese influence in the region, will dominate talks in Washington.